TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Tuesday, January 5, 2016

The IRS Scandal, Day 971

IRS Logo 2Washington Post:  Goodbye to 2015, a Year of Absurdity and Overreach, by George F. Will:

E.B. White reportedly said “the most beautiful sound in America” is “the tinkle of ice at twilight.” In 2015’s twilight, you had to fortify yourself with something 90 proof as you remember that year in which: ...

The Internal Revenue Service persecutes conservative advocacy groups but does not prosecute IRS employees who are tax cheats: An audit revealed that over the past decade, the IRS fired only 400 of the 1,580 employees who deliberately violated tax laws, rather than the 100 percent required by law. ...

This list of 2015 ludicrousness could be lengthened indefinitely, but enough already. The common thread is the collapse of judgment in, and the infantilization of society by, government.

Happier New Year.

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January 5, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Monday, January 4, 2016

The IRS Scandal, Day 970

IRS Logo 2American Center for Law and Justice, ACLJ Forces IRS to Comply with the Law in Major Federal Lawsuit:

The ACLJ has secured an important victory in our Freedom of Information Act (FOIA) case against the IRS on behalf of Citizens for a Strong New Hampshire. After a year of litigation, which followed over four months of waiting for the IRS to respond to its FOIA request, we finally succeeded in compelling the IRS to comply with its obligations under federal law.

As we have previously written, Citizens for a Strong New Hampshire issued a FOIA request to the IRS in June 2014 seeking communications between two New Hampshire legislators and certain IRS officials, including Lois Lerner, the IRS’s Exempt Organizations Director who was at the center of the IRS Tea Party targeting scandal. Rather than search for and provide responsive documents within the statutory time period, the IRS sat on the request for months as the November 2014 elections approached. This delay blatantly flouted the very purpose of the Freedom of Information Act, as it prevented Citizens for a Strong New Hampshire from knowing whether these legislators had engaged in any communications with the IRS in which the New Hampshire public might be interested—and, if so, disseminating that information to voters prior to the November elections.

In order to get a response from the IRS, we filed a federal lawsuit on behalf of Citizens for a Strong New Hampshire. While the IRS did perform a search and provide some responsive documents shortly thereafter, it was not at all clear that the agency had searched all sources reasonably likely to contain responsive records or that the records it refused to produce were properly withheld. After raising these issues with the court, we succeeded in forcing the IRS to provide the withheld documents to the court—essentially a means of providing the necessary assurances that the IRS had not withheld documents to which the organizations enjoyed a right of access. We also obtained an order from the court explaining that the IRS had failed to demonstrate the reasonableness (i.e., thoroughness) of its search for documents.

The upshot of the court’s order was that we would be heading to trial—a highly unusual occurrence in FOIA cases. On its own initiative, however, obviously realizing that its prior search was deficient, the IRS undertook two additional searches and provided the necessary information to Citizens for a Strong New Hampshire (and the court) to demonstrate the appropriateness of these new searches.

In short, the IRS finally decided to fully comply with its legal obligations under FOIA, providing Citizens for a Strong New Hampshire with the relief it had been seeking for nearly a year and a half.

We are pleased to have obtained this positive outcome for Citizens for a Strong New Hampshire and will continue to pursue litigation in federal appeals court on behalf of the numerous nonprofit organizations that are still seeking relief from the IRS’s unlawful targeting of conservative groups.

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January 4, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Sunday, January 3, 2016

The IRS Scandal, Day 969

IRS Logo 2Washington Examiner op-ed:  Congress Moves to Protect Free Speech From Bureaucratic Assault, by Luke Wachob (Center for Competitive Politics):

Tucked away in the 2,000 page omnibus tax and spending deal to fund the government is an early Christmas gift to proponents of free speech.

Seven provisions of the deal will help encourage more speech or put a halt to various efforts to increase regulation of political speech via the executive branch. After years of losing at the Supreme Court, in Congress and at the Federal Election Commission, those who wish to limit speech under the guise of campaign finance "reform" have increasingly focused their efforts on pressuring administrative agencies to achieve through regulation what could not be won via legislation. Through these seven provisions, Congress put a stop to much of this nonsense.

The riders may seem relatively unassuming, but they are in fact a major victory. Threats to speech increasingly originate from the executive branch, most prominently during the IRS targeting scandal. Years of urging from "reform" groups and thin-skinned politicians duped the IRS into playing the role of speech police, with predictably disastrous results. The agency discriminated against conservative groups applying for tax-exempt status on the basis of their names and political beliefs, with no regard for the First Amendment.

Congress sought to prevent such abuse in the future; the omnibus prohibits the agency from working on new speech regulations over the coming year.

The IRS was not alone, however, in being pushed outside its duties to regulate speech. ...

[The omnibus provisions] further prohibit the president from issuing an executive order requiring companies to report their federal election campaign donations, which are already publicly disclosed, as part of the process for bidding on government contracts; clarify that the IRS may not attempt to stifle speech by collecting the Gift Tax on donations to organizations advocating for social change; forbid IRS employees from conducting government business on personal email addresses; and require that employees be fired if they discriminate against groups or individuals on the basis of political belief.

Several of these provisions — most pointedly the requirement that government business be conducted over government email — are clearly a response to the actions of Lois Lerner, the IRS official at the center of the scandal whose use of a personal email address resulted in missing emails that frustrated investigators. But the IRS's hostility towards free speech did not end with Lerner's resignation. Instead, it sought to make restrictive speech rules official IRS policy, proposing harsh new rules that would have silenced many nonprofit advocacy groups during election years.

Those rules were withdrawn in the face of overwhelming, bipartisan opposition, but the IRS promised to try again and potentially apply the new rules to an even broader swath of groups. By denying funding for the development of new rules, Congress ensures that if new rules are written, it will be by the next president.

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January 3, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Saturday, January 2, 2016

The IRS Scandal, Day 968

IRS Logo 2Phil Kerpen (President, American Commitment), The Free Speech Silver Lining in the Budget Cloud:

The massive omnibus package of tax and spending changes recently passed by Congress was mostly a defeat for free-market economics. ... But the deal is actually a triumph in the single most important policy area: the First Amendment. ...

In 2012, Democrats won a national election by turning the IRS into a political intimidation agency, systematically destroying the vitality of the tea party movement that delivered a conservative wave in 2010. Given the level of scrutiny the agency is now under as a consequence, you might think there was no way they could use the same playbook to tilt the playing field for 2016. But the IRS was actually poised to propose official rules that would have been facially neutral but would have had the effect of silencing precisely the same groups that were sidelined by targeting in 2012.

This deal takes that risk off the table by expressly prohibiting such rules.

The deal also includes a comprehensive package of IRS reforms authored by Rep. Peter Roskam of Illinois that enjoy broad support but that until now had failed many attempts to be attached to a legislative vehicle that would be signed by the president.

That package includes a prohibition on IRS employees using private email address, as we know Lois Lerner and her coconspirators often did when orchestrating targeting, a mechanism for nonprofit groups to challenge IRS determinations in court so that they cannot be held indefinitely in limbo, and a provision requiring any IRS employee engaged in political targeting to be fired. (In the recent scandal nobody was: Even Lois Lerner was allowed to retire with her full pension.)

Most significantly, Roskam's reform package bans the IRS from trying to assess gift tax on contributions to nonprofit organizations, which they infamously attempted against conservative donors.

In 2011, donors to conservative groups were told that despite decades of clear legal understanding and practice, they could be found liable for gift tax on their contributions. While the IRS never did impose such a tax, the threatening letters they sent likely had a chilling effect on contributions to conservative groups, which was the point.

Taxing contributions to nonprofits would do nothing to advance the intended purpose of the gift tax — enforcing compliance with the federal estate tax — and would serve to dramatically diminish the ability of nonprofit groups to educate and mobilize citizens in the public policy process. Yet some liberal advocates continued to praise these abusive letters and even call for more of them to be issued.

Now donors have an ironclad legal guarantee that their contributions to nonprofit groups will not be subject to threatening IRS audit letters and arbitrary taxation.

The bottom line is that on a wide range of issues the omnibus deal is deeply disappointing, but the First Amendment provisions are an enormous silver lining because they mean activists will not be IRSed in 2016 the way they were in 2012. And that assures conservatives an honest opportunity to effectively engage the political process and come back to win on all the other issues.

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January 2, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Friday, January 1, 2016

The IRS Scandal, Day 967

IRS Logo 2The Blaze op-ed:  Despite New Limits, The IRS is Not Yet Under Control, by Andrew F. Quinlan (President, Center for Freedom and Prosperity):

The massive omnibus spending package passed by Congress included new limits on the IRS, in particular on the agency’s ability to harass political non-profits. Congress is not done, however, as an ongoing dispute between the tax collection agency and Microsoft demonstrates that the IRS continues to operate outside the bounds of the law.

The IRS is in the midst of an almost nine-year audit of Microsoft. That’s unusual given the three-year statutory limit for audits. Sometimes they can be extended when necessary, but the IRS has asked and been granted permission by Microsoft to do so eight times already. Most notable, however, is the fact that Microsoft just wants to pay its bill and move on, but the IRS has refused to submit one. That might be due to the fact that the never-ending audit is proving quite profitable for a powerful, politically-connected law firm.

Again acting outside normal procedure, the IRS brought in lawyers from Quinn Emanuel Urquhart & Sullivan, a major contributor to Barack Obama and the Democrat Party. This despite the fact that the IRS already employs a veritable army of lawyers and accountants with more relevant expertise.

The use of outside lawyers raises serious concerns regarding taxpayer privacy and potential conflicts of interest. Namely, that a $1,000-per-hour firm is going to be less motivated to resolve a case quickly and efficiently than the taxpayers footing their bill.

The $2.2 million contract for Quinn Emanuel also comes at a time when the IRS is claiming poverty and a lack of sufficient funds for assisting taxpayers.

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January 1, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, December 31, 2015

Tax Rate Of Top 400 Taxpayers Soared 37% In 2013, To Highest Rate Since 1997

On Tuesday, the New York Times published a front page article on How The Ultra Wealthy Buy Tax Policy, which contained this statement:

Two decades ago, when Bill Clinton was elected president, the 400 highest-earning taxpayers in America paid nearly 27 percent of their income in federal taxes, according to I.R.S. data. By 2012, when President Obama was re-elected, that figure had fallen to less than 17 percent, which is just slightly more than the typical family making $100,000 annually, when payroll taxes are included for both groups. 

On Wednesday, the IRS released updated data showing that in 2013 the Top 400 taxpayers bore the highest tax rate since 1997:

Top 400 - 2

Wall Street Journal, Tax Rate for Top 400 U.S. Taxpayers Climbed in 2013: Obama Administration Policies Reversed a Decadeslong Trend Toward Lower Tax Burdens for Wealthiest Americans:

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December 31, 2015 in IRS News, Tax | Permalink | Comments (2)

The IRS Scandal, Day 966

IRS Logo 2Following up on my previous coverage (here, here, and here):  Breitbart, Koch Brothers May Have to Disclose Donor List to California:

The San Francisco Ninth Circuit Court of Appeals overruled a U.S. District Court judge to give authority to California Attorney General Kamala Harris to obtain the donor list from the Koch Brothers-backed Americans for Prosperity Foundation.  [Americans for Prosperity v. Harris, No.  15-55446 (9th Cir. Dec. 29, 2015)].

The Americans for Prosperity Foundation was founded by Charles and David Koch as a national foundation in 2004 and registered in all states, including California, as a nonprofit organization promoting limited government and free markets by educating individuals around the country about practical ways to improve their circumstances. It became one of the most influential American conservative political advocacy organizations after the 2009 inauguration of President Barack Obama. ...

But AFP became the number one target of elected Democrat officials and their constituencies for the role the organization played in breaking Democrat majority control of the House of Representatives in 2010 and the U.S. Senate in 2014.

AFP has complied with the filing requirements with the Internal Revenue Service each year for over a decade and disclosed its nationwide list of major donors’ names and addresses on tax form “Schedule B” for a nonprofit charity. Federal criminal statutes protect the constitutional right to privacy by forbidding the IRS to make any unauthorized disclosure of charity donors to a 501(c)4 non-profit.

For a decade, California accepted AFP’s charitable registrations and renewals without need for filing Schedule Bs. But in 20014, California Attorney General and candidate for U.S. Senate Kamala Harris suddenly began demanding Schedule Bs under threat of draconian sanctions, such as personal fines against a charity’s officers. ...

AFP in February was granted a preliminary injunction protecting against disclosure of the Foundation’s Schedule B by the district court after considering evidence of threats, violence, and harassment directed at the Foundation, as attested to in sworn affidavits and confirmed by accompanying documentation.

The court stated:“Public disclosure of [the Foundation’s] Schedule B, and thus the names and addresses of its donors, would open those persons up to harassment, retaliation, and chilling of free speech.” It added: “These negative consequences would objectively work to chill protected First Amendment speech.”

But a three-judge Ninth Circuit Court of Appeals panel overturned the lower court judge, allowing California Attorney General Kamala Harris access to information from the Americans for Prosperity Foundation while the group’s lawsuit is being decided. The appeals panel’s unanimous decision said that AFP failed to show reason to fear disclosure. ...

Derek Shaffer, Americans for Prosperity, said AFP will immediately appeal the ruling to the U.S. Supreme Court.

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December 31, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

Wednesday, December 30, 2015

IRS Employee Whose Job Was Assisting Victims Of Identity Theft Charged In $1 Million Identity Theft Tax Fraud

Taxpayer Advocate (2016)Department of Justice Press Release, IRS Employee Charged in $1 Million ID Theft Tax Fraud Scheme:

Federal officials today announced arrests and charges in a stolen identity tax-refund scheme believed to involve more than $1 million in false claims and run by an IRS employee who was supposed to be assisting taxpayers experiencing problems resulting from identity theft.

A federal grand jury earlier this month indicted NAKEISHA HALL, JIMMIE GOODMAN and ABDULLA COLEMAN for their involvement in a 2008 to 2011 scheme operated out of Birmingham that involved stealing personal identity information from the Internal Revenue Service to create fraudulent tax returns and collecting the stolen refunds, announced U.S. Attorney Joyce White Vance, IRS Criminal Investigation, St. Louis Field Office, Special Agent in Charge Karl A. Stiften, and Treasury Inspector General for Tax Administration, Mid-States Field Division, Special Agent in Charge Ruben Florez. The indictment was unsealed with today’s arrests.

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December 30, 2015 in IRS News, Tax | Permalink | Comments (11)

The IRS Scandal, Day 965

IRS Logo 2Following up on my previous posts, The Problem Is Not Just IRS Lawyers; The Problem Is All Federal Government Lawyers and A Cincinnati IRS Lawyer Speaks: We Are Democrats, But Nonpartisan Democrats:  The Daily Caller News Foundation, IRS Employees Fuel Democratic Candidates, Causes:

A Daily Caller News Foundation analysis of data found Internal Revenue Service (IRS) employees have backed Democrats over Republicans by 2-1 in their political donations over the last 25 years.

Donors listing the IRS as their employer have donated roughly $453,800 to Democratic candidates and causes and $221,400 to Republican candidates and causes since 1990. About one in four of the dollars for Democrats, or roughly $117,500, went to President Barack Obama.

But IRS employees since 1990 have also donated $203,000 to the National Treasury Employees Union, which in turn has given about 95 percent of its $6 million in political contributions to Democrats over the last 25 years, data shows.

Disclosure of the huge bias among IRS employees for Democrats won’t help an agency under fire for years for illegally targeting conservative groups applying for tax-exempt status. Federal tax officials illegally tried to silence hundreds of conservative and tea party non-profit applicants during the 2010 and 2012 election campaigns.

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December 30, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Tuesday, December 29, 2015

The IRS Scandal, Day 964

IRS Logo 2Robert W. Wood (Forbes), More Calls To Impeach IRS Chief Over Targeting, Bonuses, Obstruction:

Congress has kept the IRS in business with recent funding, including slight budget increases included in the Consolidated Appropriations Act. The IRS even got some specific mandates for fraud prevention and taxpayer service, two areas where Republicans claim work is needed. Yet the alleged use of the IRS as a political weapon, and the role its Chief John Koskinen had in that long running scandal, continues to grate on some Republicans.

On Christmas eve, Sen. Pat Roberts (R-KS) wrote in the Wall Street Journal that it’s time to hold the IRS accountable for unfairness, including new IRS moves to targets political donors. Recent appropriations of money for the IRS comes with conditions, such as prohibiting the IRS from issuing new rules on the political activities of Section 501(c)(4) organizations. There are even attempts to stop the White House from ordering the IRS to review tax exempt groups. But are these and other band aids on the IRS enough?

Not for Oversight Committee Chair Jason Chaffetz, R-Utah. He wants to continue pressure on IRS Commissioner John Koskinen, including impeachment. The resolution to impeach Commissioner Koskinen was introduced by Chairman Chaffetz (R-Utah) and 18 others. Months before, he and his colleagues wrote to President Obama requesting Koskinen’s removal. The resolution claims that the IRS chief violated the public trust. ...

As Sen. Pat Roberts (R-Kan.) put it, the Obama administration used the IRS as a political tool to actively work against conservative groups. Roberts claims that the IRS suppressed electoral activities of groups that did not agree with the Obama administration’s views. But now, any impeachment efforts against Koskinen are in the hands of the House Judiciary Committee, under the helm of Rep. Bob Goodlatte, R-Va.

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December 29, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Monday, December 28, 2015

NY Times:  The Tax Sleuth Who Took Down A Drug Lord

Silk Road 2New York Times Deal Book, The Tax Sleuth Who Took Down a Drug Lord:

Gary L. Alford was running on adrenaline when he arrived for work on a Monday in June 2013, at the Drug Enforcement Administration office in the Chelsea neighborhood of Manhattan. A tax investigator, he had spent much of the weekend in the living room of his New Jersey townhouse, scrolling through arcane chat rooms and old blog posts, reading on well after his fiancée had gone to sleep.

The work had given Mr. Alford what he believed was the answer to a mystery that had confounded investigators for nearly two years: the identity of the mastermind behind the online drug bazaar known as Silk Road — a criminal known only by his screen name, Dread Pirate Roberts.

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December 28, 2015 in IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 963

IRS Logo 2Your News Now, Sen. Portman's Bill Would Give Americans More Power When Dealing With IRS:

Ohio Senator Rob Portman has introduced legislation that would give Americans more power when dealing with the Internal Revenue Service.

Senator Portman says the IRS scandal that unfolded following the 2012 election, caused him to consider the proposal.  Several conservative  groups alleged the IRS used its powers against them, making it difficult to organize and achieve tax exempt status.

IRS officials then claimed to have lost e-mails and other documentation in a subsequent investigation. Portman says the "Taxpayer Bill of Rights" would help address IRS abuse and ensure that federal employees at the IRS can be punished if found to have misused their power.

Portman's bill would allow for termination of any IRS employee caught injecting politics into IRS decisions. One IRS official, Lois Lerner, resigned from the IRS following the e-mail scandal.

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December 28, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Sunday, December 27, 2015

The IRS Scandal, Day 962

IRS Logo 2New York Times editorial, Political Dark Money Just Got Darker:

As untold millions of dollars pour into the shadowy campaign troughs of the presidential candidates, voters need to be reminded of the rosy assumptions of the Supreme Court’s Citizens United decision that legitimized the new spending frenzy. ...

The court majority in the 5-to-4 decision should have been watching this month when the Republican-controlled Congress, which has firmly bottled up all campaign disclosure legislation, voted to further cripple disclosure at two of its most vital points.

In the new budget bill, Republicans inserted a provision blocking the Internal Revenue Service from creating rules to curb the growing abuse of the tax law by thinly veiled political machines posing as “social welfare” organizations. These groups are financed by rich special-interest donors who do not have to reveal their identities under the tax law. So much for effective disclosure at the I.R.S.

In another move to keep the public blindfolded about who is writing big corporate checks for federal candidates, the Republicans barred the Securities and Exchange Commission from finalizing rules requiring corporations to disclose their campaign spending to investors. ...

In acting to seal that pocket and hobble the I.R.S., congressional Republicans are advancing what has become the dark age of plutocratic money in campaign spending. At every turn, they are veiling the truth about the special-interest ties they have with rich donors shopping for favors. Since the Citizens United decision in January 2010, politicians have collected more than $500 million in dark money from phantom donors, according to the Center for Responsive Politics, with hundreds of millions more expected in the current campaign.

The move against the S.E.C. blocked it from “finalizing” a corporate disclosure rule, leaving proponents hopeful that it could be studied for some future enactment. This is not likely with a Republican Congress, which has made the I.R.S. even more of a target. Conservative lawmakers contend that tax investigators have been biased against right-wing political groups operating as “social welfare” organizations. And Congress has cut the tax agency budget by 18 percent since 2010, reducing its work force and weakening tax law enforcement.

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December 27, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Saturday, December 26, 2015

The IRS Scandal, Day 961

IRS Logo 2Investor's Business Daily, After Tearing Up First Amendment, IRS Can Tear Up Passports:

Abuse Of Power: Some thought the IRS would be punished after interfering in a presidential election by harassing conservative organizations. Instead, the tax man gets the new power of revoking your passport.

The massive transportation bill that a Republican Congress passed this month gives the Internal Revenue Service new powers to authorize the State Department to revoke U.S. passports.

It's hard not to draw a connection between this and Americans living abroad who are renouncing their precious U.S. citizenship in record numbers in recent years for one reason: to prevent the IRS from shaking them down.

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December 26, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, December 25, 2015

The IRS Scandal, Day 960

IRS Logo 2American Center for Law and Justice, 2015 Victories: Holding the IRS Accountable:

In the aftershock of the IRS scandal targeting Tea Party and other conservative organizations applying for tax-exempt status, one conservative group submitted a Freedom of Information Act (FOIA) request to the IRS seeking certain correspondence involving high-ranking IRS officials and left leaning politicians. The time-sensitive FOIA request was submitted right before the November 2014 congressional elections.

Delaying and balking at every attempt to make it hand over documents exposing its conduct, the IRS simply refused to play by the rules. It failed to respond within the time required.  Stall tactics.  Citizens for a Strong New Hampshire contacted the ACLJ, and we filed a federal lawsuit demanding accountability.  The IRS finally provided some documents, but it was clear others were missing.  More stall tactics. 

We insisted the IRS answer for its behavior in court. First, the court was not persuaded by the IRS’s attempts to dodge accountability to the people and determined that this case must go to trial. As less than 1% of these types of cases actually go to trial, this was a victory in steps. Now, facing our litigation, the IRS has finally decided to perform the requisite search for responsive documents - required by law. This is a major victory.  In the end, we forced the IRS to turn over documents it had refused to turn over to the public.  The IRS's stall tactics failed.  Only through litigation are we able to force the IRS to follow the law and be held accountable to the American people.

This is why we continue pressing forward with major legal efforts against the IRS. Our major case on behalf of dozens of conservative groups from across America demanding justice continues on appeal.  Each victory along the way brings us one step closer to the truth and one step closer to justice for those illegally targeted for their beliefs by the IRS.

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December 25, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, December 24, 2015

The IRS Scandal, Day 959

IRS Logo 2Wall Street Journal:  It’s Time to Hold the IRS Accountable for Unfairness, by Sen. Pat Roberts (R-KS):

Your editorial The IRS Targets Political Donors (Dec. 16) hits the nail on the head about the IRS’s new proposed regulation that targets nonprofit organizations. When I heard about the IRS’s latest assault, I introduced legislation to block this “voluntary” rule. It would have a chilling effect on charitable giving and add a costly burden to charitable organizations. The IRS has already threatened donors in groups that it doesn’t like and proved that it cannot safeguard personal and private information from being hacked. Why should we trust them with a new source of data on donors? The proposal is bad for donors, it’s bad for nonprofits and it’s bad for the communities that are served by charitable donations. The IRS’s assault on the charitable sector must stop. My bill will do that.

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December 24, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Wednesday, December 23, 2015

The IRS Scandal, Day 958

IRS Logo 2Politico, White House Surrenders on 'Dark Money' Regulation:

The Obama administration has thrown in the towel on cracking down on hundreds of millions of dollars in “dark money” — funds given to advocacy groups that claim to be social welfare organizations rather than political committees.

Closing the so-called social-welfare loophole — which exempts the groups from federal tax and disclosure requirements — was one of the most urgent priorities of campaign-finance reformers in the wake of the Supreme Court's decision in the Citizens United case. But then the IRS came under fire for holding up conservative groups applying for the social-welfare tax exemption, and many Republicans cried foul.

By giving in to a GOP provision in the omnibus spending bill, the administration has effectively given up on limiting the political influence of nonprofit groups with unknown funders. ...

Some suspect that the Obama administration was wary of litigating the issue in the midst of the 2016 campaign. Even though Koskinen had assured lawmakers the rules would not take effect before the election, tea party groups and others on the right would almost certainly have pounced on any proposal released before then as an effort to muzzle free speech.

“From the Obama administration’s point of view, nothing was going to happen this election cycle … it was going to happen after he was done anyway,” said David Keating, president of the Center for Competitive Politics, which supports the rider. “And going into an election year the last thing they needed to do probably was raise the whole topic of the IRS scandal again.”

Congress didn’t stop there.

Keating pointed to a handful of other riders and tax provisions in the year-end tax-and-spending deal — including a provision barring the Securities and Exchange Commission from requiring corporations to disclose campaign spending to shareholders, and a ban on applying the gift tax to nonprofit donors. ...

The issue stems as much from the 2013 IRS scandal as it does from Citizens United. Republicans were infuriated when the IRS inspector general disclosed the agency had stalled the applications of tea party-affiliated organizations after Citizens United.

The report triggered the biggest scandal in recent IRS history: Several officials, including Exempt Organizations Director Lois Lerner, were pushed out, and the agency is still under investigation on the Hill. The inspector general called for clearer guidelines for delineating social welfare groups and political organizations. In response, the IRS floated guidance in November 2013 to police the political activity of social welfare groups.

But the proposal — released just over six months after the targeting scandal came to light — caused such an uproar that agency officials said they would start over from square one.

Technically, the congressional regulation ban lasts only through September 2016, but the timetable for finalizing regulations means the effort will have to be left to the next administration. A Republican president presumably would bury the rules, and a Republican Congress could continue to block them under a Democratic administration.

“If they were going to finalize this before the [Obama] administration leaves office they’d have to release the proposal by around Jan. 20 … so the delay until the end of the fiscal year effectively kills the regulation,” Georgetown law professor Brian Galle said.

“To be honest I expected them to issue it on Christmas Eve,” Galle said. He added: “What surprises me is the administration didn’t stand up a little more firmly on this provision …They didn’t even, as far as I know, make any effort to bluff that they were going to [veto it].”

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December 23, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Tuesday, December 22, 2015

The IRS Scandal, Day 957

IRS Logo 2Washington Post, Republicans ‘Rein in’ the IRS in New Budget After Years of Grievances:

There is no love lost between Republicans in Congress and the Internal Revenue Service, whether it’s their dislike for the tax code, the current tax commissioner or their fury at the agency’s treatment a few years ago of conservative groups.

With many lawmakers still smarting over that controversy, the GOP used the budget deal reached by House and Senate negotiators this week to tighten the reins on the IRS with a series of little-noticed Mother-May-I provisions.

They’re largely symbolic. But they speak loudly. ...

Its employees must not use personal email accounts for work communications, a practice that got both Hillary Clinton and Lois Lerner, the former IRS official at the center of the scandal over tax-exempt groups in trouble. ...

And it cannot target groups for scrutiny based on their ideological beliefs, new language repeated in three separate provisions of the bill. ...

Republicans investigated the IRS for more than two years after agents were discovered to have subjected conservative groups applying for tax-exempt status to additional scrutiny. In October, they moved to impeach Commissioner John Koskinen, days after the Justice Department formally closed its investigation of the scandal without filing criminal charges. They accused him of erasing back-up tapes containing thousands of emails written by Lerner.

After the budget deal was announced this week, House Majority Leader Kevin McCarthy (R-Calif.) crowed in a press release, “The House is Reining in the IRS.” “House Republicans have worked since the IRS scandal to rein in this unaccountable agency and make sure no American citizen has their fundamental rights infringed upon,” McCarthy wrote. “In the upcoming spending bill, we put severe constraints on the IRS to stop the abuse.” ...

Democrats did not rush to condemn the new budget provisions. John Lewis (D-Ga.), the top Democrat on the oversight panel of the House Ways and Means Committee, said he generally agreed with them.

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December 22, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Monday, December 21, 2015

Swiss Banking Lawsuit Could Rein In IRS's Prosecution Of Offshore Tax Evasion

Wall Street Journal, Swiss-Banking Lawsuit Against IRS Could Have Wide Impact:

Bernhard Gubser was among thousands of clients outed five years ago by Swiss bank UBS Group AG to U.S. officials on the hunt for tax evaders.

Now, the 66-year-old Swiss citizen, who moved to the U.S. decades ago, picked up an American passport and nonetheless continued sending money back to Switzerland, is suing the Internal Revenue Service.

His case shines a light on U.S. rules designed to determine if a failure to declare an offshore bank account is willful wrongdoing, or a simple mistake. Mr. Gubser’s lawsuit could help set a precedent for Americans seeking to challenge aspects of the U.S. bid to clamp down on offshore tax evasion—an effort that has focused heavily on Switzerland. ...

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December 21, 2015 in IRS News | Permalink | Comments (0)

The IRS Scandal, Day 956

IRS Logo 2Washington Post, Republicans ‘Rein in’ the IRS in New Budget After Years of Grievances:

There is no love lost between Republicans in Congress and the Internal Revenue Service, whether it’s their dislike for the tax code, the current tax commissioner or their fury at the agency’s treatment a few years ago of conservative groups.

With many lawmakers still smarting over that controversy, the GOP used the budget deal reached by House and Senate negotiators this week to tighten the reins on the IRS with a series of little-noticed Mother-May-I provisions.

They’re largely symbolic. But they speak loudly. ...

Its employees must not use personal email accounts for work communications, a practice that got both Hillary Clinton and Lois Lerner, the former IRS official at the center of the scandal over tax-exempt groups in trouble. ...

And it cannot target groups for scrutiny based on their ideological beliefs, new language repeated in three separate provisions of the bill. ...

Republicans investigated the IRS for more than two years after agents were discovered to have subjected conservative groups applying for tax-exempt status to additional scrutiny. In October, they moved to impeach Commissioner John Koskinen, days after the Justice Department formally closed its investigation of the scandal without filing criminal charges. They accused him of erasing back-up tapes containing thousands of emails written by Lerner.

After the budget deal was announced this week, House Majority Leader Kevin McCarthy (R-Calif.) crowed in a press release, “The House is Reining in the IRS.” “House Republicans have worked since the IRS scandal to rein in this unaccountable agency and make sure no American citizen has their fundamental rights infringed upon,” McCarthy wrote. “In the upcoming spending bill, we put severe constraints on the IRS to stop the abuse.” ...

Democrats did not rush to condemn the new budget provisions. John Lewis (D-Ga.), the top Democrat on the oversight panel of the House Ways and Means Committee, said he generally agreed with them.

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December 21, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Sunday, December 20, 2015

The IRS Scandal, Day 955

IRS Logo 2Wall Street Journal editorial, Free Speech and the Freedom Caucus: Congress Blocks IRS Political Meddling, but the Right Blows a Chance to Do More:

Republican disunity has limited Congress’s power of the purse, but the GOP majority has marked up a few victories. The budget and tax bills moving this week usefully block the IRS and other agencies from restricting political speech.

In 2014 opposition from the left and right forced the IRS to back down on its rule limiting political activities by tax-exempt 501(c)(4) groups. But director John Koskinen, the most tone-deaf man in Washington, says he wants to try again, and the spending bill includes a provision that shuts that down.

The tax bill also blocks the practice of IRS employees using personal email for official business. The use of personal email by Lois Lerner, then head of the tax-exempt division, became a stumbling block for investigators trying to discover what happened. A provision in the tax bill also bans the IRS from imposing the gift tax on donations to 501(c) groups, an idea the agency considered in 2011 when it audited several conservative donors.

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December 20, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Saturday, December 19, 2015

The IRS Scandal, Day 954

IRS Logo 2Wall Street Journal: The Obama Secrets Regime: Republicans Ban the IRS From Private Email. But Why Not All Federal Employees?, by Kimberley A. Strassel:

Some scandals come on fast, and some creep up on Washington. The slow-rolling outrage of 2015—Obama administration secrecy—received a small correction in this week’s omnibus budget bill, but it deserves far more attention. It’s time for the federal government to come back on the grid.

A steady drip of news has shown that for seven years now, the highest (and lowest) echelons of the Obama administration have conducted the people’s business in secret, via private email addresses and other hidden electronic means. They’ve been doing so in contravention of department guidelines, executive orders and statutes that require record-keeping and public accountability. Since those rules are well known and understood, it has to be assumed that they’ve been doing it purposely, to hide their actions.

The New York Times on Thursday revealed the latest email-hider: Defense Secretary Ash Carter. Mr. Carter was confirmed in February, and from the start used a private account to correspond with aides about everything from legislation to media appearances. He may well have discussed far more serious, classified matters, but we don’t know. That’s because we must rely on Mr. Carter’s word that he turned all his work correspondence over to the Defense Department. Just as we must trust that Hillary Clinton didn’t delete anything official from the private server she used as secretary of state. ...

One irony of these scandals is that, in seeking to keep government business secret from Americans, officials make it more available to foreign enemies. ...

Disgraced former IRS official Lois Lerner used two off-reservation email addresses, as well as an internal instant-messaging service that didn’t archive conversations. ...

Republicans this week included in the omnibus bill a rider that bars IRS employees from using private email for work. The question is why they stopped there. Conservatives complain ceaselessly about the Obama administration’s extralegal or abusive practices, and the record shows a main conduit for these shenanigans is private email. Since we can have no confidence they will provide a full record of their private correspondence, the wiser course is to bar it entirely. For every federal employee.

The best excuse any Obama official has been able to come up with for these accounts is “convenience”—and that’s a hoot in today’s world of easy-to-use technology. More to the point, who ever said federal employees are due “convenience”? They aren’t the average American. Quite the opposite. They serve the average American, and a core duty is to create a public record of their work. If Republicans want a 2016 issue that will resonate with the public, here’s one: End the Obama Secrets Regime.

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December 19, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Friday, December 18, 2015

Bed Bugs At Cincinnati IRS Service Center Force Trainee To Quit

December 18, 2015 in IRS News, Tax | Permalink | Comments (3)

Accountant For ‘The Situation’ Pleads Guilty To Tax Charge

SituationDepartment of Justice Press Release, Accountant for Michael ‘The Situation’ Sorrentino Admits Tax Fraud Conspiracy:

The former tax preparer for television personality Michael “The Situation” Sorrentino and his brother, Marc Sorrentino, today admitted filing fraudulent tax returns on their behalf, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Paul J. Fishman of the District of New Jersey announced.

Gregg Mark, 51, of Spotswood, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of conspiracy to defraud the United States.

According to documents filed in this case and statements made in court: Mark, formerly an accountant at a Staten Island, New York-based accounting firm, admitted preparing fraudulent tax returns for the Sorrentinos for tax years 2010 and 2011, during which time the Sorrentinos and their businesses – MPS Enterprises LLC and Situation Nation Inc. – received millions of dollars in income. To reduce the taxes the Sorrentinos owed, Mark caused to be prepared and filed with the Internal Revenue Service (IRS) fraudulent business and personal tax returns. Mark admitted the Sorrentinos’ false returns defrauded the IRS out of $550,000 to $1.5 million.

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December 18, 2015 in IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 953

IRS Logo 2Lamar Smith (R-TX), It’s Time to Impeach IRS Commissioner Koskinen:

Today I joined fellow lawmakers in sponsoring a resolution to impeach Internal Revenue Service (IRS) Commissioner John Koskinen.

The IRS Commissioner should have put the public interest ahead of this administration’s political agenda. What the IRS did was a threat to democracy. Americans have lost confidence in IRS Commissioner Koskinen’s ability to lead what should be one of the most non-partisan agencies in the federal government. He has sought to cover up the agency’s political harassment of conservative organizations. This is inexcusable. It is a shame that Congress has to file an impeachment resolution because this administration should have fired him over a year ago. ...

In addition to sponsoring the impeachment resolution, today I voted for a tax extenders bill that included previously-passed House measures to protect taxpayers and rein in the IRS.

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December 18, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Thursday, December 17, 2015

IRS Releases 2016 Standard Mileage Rates

IRS Logo 2The IRS today released (IR-2015-137) the standard mileage rates for 2016 (Notice 2016-01,  2016-02 I.R.B. ___ (Jan. 11, 2016)):

Beginning on Jan. 1, 2016, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be:

  • 54 cents per mile for business miles driven [down 3.5 cents from 2015]
  • 19 cents per mile for medical or moving purposes [down 4 cents]
  • 14 cents per mile for charitable organizations [unchanged]

December 17, 2015 in IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 952

IRS Logo 2Los Angeles Times, How the Budget Deal Opens the Door Even Wider for Secret Money in Politics, by Michael Hiltzik:

When Congress legislates at night and in haste, you can be sure mischief is being done. Sure enough, the budget deal announced late Tuesday by House Speaker Paul D. Ryan (R-Wis.), takes an ax to efforts to limit the torrent of big money into politics.

Two provisions buried in the 2,009-page bill -- one on page 472 and the other on page 1,982 -- emasculate efforts by the Internal Revenue Service and Securities and Exchange Commission to force public disclosure of donations by individuals and corporations.

These are donors who represent no one's interests but their own, and their influence over politics and the electoral process has only grown since the Supreme Court's wretched Citizens United decision in 2010.

It's now poised to get even bigger, thanks to the riders' inclusion in an omnibus budget bill that's being handled as must-pass legislation to avoid a government shutdown. As Common Cause President Miles Rapoport said in a prepared statement Wednesday: "The omnibus proposal keeps the government’s lights on in exchange for more secret money in politics."

Here's how the deal protects big secret donors.

The IRS provision prohibits the agency from taking any step toward issuing a rule governing the political activities of so-called 501(c)4 nonprofit organizations. By law, these nonprofits aren't supposed to be involved in politics at all. They're "social welfare" organizations that by law must be devoted primarily to programs broadly serving their communities, not private groups; the category used to be limited to religious groups; cultural, educational and veterans organizations, homeowners associations, volunteer fire departments; and the like.

But they're allowed to keep their donors secret, a benefit that made them into an all-too-tempting instrument for political contributions. Over the years, the IRS loosened its strictures on political activities by C4s, ultimately allowing them to spend money on politics as long as they kept the activity under 50%. (We tracked this evolution starting back in 2012.)

In 2013, the IRS tried to crack down on political C4s masquerading as social welfare groups. The ultimate harvest was the ginned-up IRS "scandal," in which Rep. Darrell Issa (R-Vista) tried, and ultimately failed, to prove that the agency crackdown was focused on conservative organizations.

The real goal of the IRS attackers was to hamstring its regulation of any political C4s, which were too good a funnel for secret money. Instead, the IRS sat down to write bright-line regulations defining the permissible activities of C4s once and for all.

You shouldn't be surprised that front persons for big-money donors -- that is, almost everyone in Congress -- are exploiting the budget negotiations to stop that effort in its tracks. According to the budget bill, no funds can be used by the IRS to "issue, revise, or finalize any regulation, revenue ruling, or other guidance" related to 501(c)4s. Who benefits from this stricture? The secret donors, that's who.

Here is the statutory language (from Brian Galle):

Sec. 127. During fiscal year 2016—
(1) none of the funds made available in this or any other Act may be used by the Department of the Treasury, including the Internal Revenue Service, to issue, revise, or finalize any regulation, revenue ruling, or other guidance not limited to a particular taxpayer relating to the standard which is used to determine whether an organization is operated exclusively for the promotion of social welfare for purposes of section 501(c)(4) of the Internal Revenue Code of 1986 (including the proposed regulations published at 78 Fed. Reg. 71535 (November 29, 2013)); and 
(2) the standard and definitions as in effect on January 1, 2010, which are used to make such determinations shall apply after the date of the enactment of this Act for purposes of determining status under section 501(c)(4) of such Code of organizations created on, before, or after such date.

Here are additional statutory provisions (from Lloyd Mayer):

  • Division E, Title II, Section 610(a)(2) prohibiting the Executive Office of the President from asking the Treasury or IRS for a determination with respect to a 501(c) tax-exempt organization.
  • Division O, Title V, Section 707 prohibiting the use of funds by the SEC to pursue disclosure of political spending.

And in Division Q, which contains most of the tax provisions (the descriptions are just the headers from the table of contents for the bill):

  • 402. IRS employees prohibited from using personal email accounts for official business.
  • 403. Release of information regarding the status of certain investigations. [Limited to investigations relating to unauthorized disclosure of information or other unauthorized acts and limiting the release to the person whose return or return information is at issue if they provided information relating to the disclosure or act.]
  • 404. Administrative appeal relating to adverse determinations of tax-exempt status of certain organizations.
  • 405. Organizations required to notify Secretary of intent to operate under 501(c)(4).
  • 406. Declaratory judgments for 501(c)(4) and other exempt organizations.
  • 407. Termination of employment of Internal Revenue Service employees for taking official actions for political purposes.
  • 408. Gift tax not to apply to contributions to certain exempt organizations. [Note that it does not cover the estate tax.]

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December 17, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Wednesday, December 16, 2015

The IRS Scandal, Day 951

IRS Logo 2Wall Street Journal editorial, The IRS Targets Political Donors:

The IRS regulatory assault on political nonprofits continues, albeit out of the media glare. In September the Internal Revenue Service and Treasury Department proposed a rule to give 501(c)(3) charities the “option” of filing detailed reports on every donor who contributes more than $250. These reports would include names, addresses and Social Security numbers. Oh, oh.

While the IRS says the rule is “voluntary,” in government that’s often a prelude to compulsory. The legitimate fear in the nonprofit world, on the right and left, is that this is a first step toward making such donor lists mandatory, and then applying the requirement to every nonprofit—including the conservative social-welfare organizations that the IRS helped to shut down in the 2012 presidential election. ...

Many taxpayers will also lack confidence that nonprofits, which are often small operations staffed by volunteers, can safeguard their information. The proposed regulation is an invitation to fraud and identity theft by creating an opportunity for scam artists to claim to be charities and solicit Social Security numbers.

This year the IRS was forced by public outrage to shelve a different regulation that sought to limit the amount of political activity social-welfare organizations can engage in. The new rule looks like an attempt to achieve a similar result by drying up contributions. The rule’s public comment period ends Wednesday, but Democrats and Republicans in Congress should work together to put this one on ice.

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December 16, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

Tuesday, December 15, 2015

Lobel:  The IRS Is In Crisis And The Tax Community Needs To Help

Martin Lobel (Lobel Novins & Lamont, Washington, D.C.; Chair, Tax Analysts' Board of Directors), The IRS Is in Crisis and the Tax Community Needs to Help, 149 Tax Notes 1407 (Dec. 14, 2015):

We are on the edge of a precipice. Unless those who know the importance of the IRS take action, we are on the verge of losing the respect and, indeed, fear of the IRS that makes it such an effective revenue raiser. And, without sufficient revenue, we don't have a government that can meet our essential needs.

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December 15, 2015 in IRS News, Scholarship, Tax | Permalink | Comments (5)

The IRS Scandal, Day 950

IRS Logo 2Going Concern:  Some People Still Care About the IRS Scandal, by Caleb Newquist:

Pepperdine tax law professor Paul Caron has been keeping track of the media coverage of the IRS scandal since its beginning, even if most people stopped paying attention to those stories years ago. [Last Tuesday] he thought that he might give up the feature because "the scandal has gone mostly quiet" but [he was] back to it [last Wednesday] with Day 944 even though there is virtually no news about it. Maybe he can start counting the days that Donald Trump remains in the presidential race?

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December 15, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Monday, December 14, 2015

Gay Stetson Law Prof Challenges IRS's Denial Of Deduction For In-Vitro Fertilization, Surrogacy Expenses

MorrisseyTampa Tribune, Gay Parents Sue After IRS Denies Tax Deduction for In-Vitro Fertilization, Surrogate:

Is being gay, in a long-term committed relationship, the same as being biologically infertile? That’s the argument being made by a Stetson law professor in a lawsuit against the federal government.

Joseph F. Morrissey, who teaches constitutional and business law at Stetson, is seeking to overturn a ruling by the IRS that denied him and his partner a tax deduction. The deduction would have been for costs associated with their use of in-vitro fertilization and a surrogate who gave birth to their twin sons.

An IRS revenue agent who denied the claim said Morrissey’s sexual orientation was a “choice,” according to the lawsuit filed in U.S. District Court in Tampa. ...

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December 14, 2015 in IRS News, Legal Education, New Cases, Tax | Permalink | Comments (0)

The IRS Scandal, Day 949

IRS Logo 2Washington Times:  Who Will Stop the IRS?, by Judson Phillips (Founder, Tea Party Nation):

The Internal Revenue Service. Those are four words that will cause fear in almost every American. There is something seriously wrong when America has a government that is of the people, by the people and for the people; and the American people have to be afraid of the government.

The Obama regime weaponized the IRS for use against conservatives in 2010. After the IRS scandal became public in 2013, conservatives looked to Republicans in Washington. The House of Representatives took no action against the IRS. At a time when then House Speaker John Boehner could have incarcerated Lois Lerner, the IRS official at the center, but chose not to.

Emboldened by the failure of the Republicans to act, the IRS is moving again. Last week, the Internal Revenue Service proposed a regulation that would “give” non-profits, including 501C4 groups, the “option” of recording the Social Security numbers of donors who contribute $250 or more.

What could possibly go wrong?

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December 14, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Sunday, December 13, 2015

The IRS Scandal, Day 948

IRS Logo 2Liberty News Now, Obama Sending IRS After Conservatives Again?:

Considering the Obama Administration’s well-documented willingness to use the Internal Revenue Service (IRS) as a political weapon to intimidate, silence and bankrupt organizations and individuals who oppose the president, a proposed IRS rule to force charities, churches and nonprofits to report the Social Security numbers of donors to the IRS could dry up donations and run them out of business.

In response to the proposed rule, the Tea Party Patriots – a target of the IRS in the past – has launched a nationwide email and social media campaign encouraging supporters and conservative leaders to kill the proposed a rule before it is finalized and becomes law. ...

In an interview with The Daily Signal, Hans von Spakovsky, a senior legal fellow at The Heritage Foundation cited recent revelations that the IRS leaked confidential donor information filed by conservative groups, to the news media and political opposition groups. “Just think if they had leaked not only the names of the donors, but Social Security numbers,” von Spakovsky said. “I don’t trust the government to have that information, and there’s no reason for them to have that information.”

In the aftermath of leaks by the IRS of confidential donor information submitted by conservative groups by law, donors came under withering attack in the media and radical left groups seeking to dry up financial donations to targeted groups.

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December 13, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Saturday, December 12, 2015

The IRS Scandal, Day 947

IRS Logo 2The Blaze, IRS Power Grab? Deadline Looming for Public Comment on New Rule to Gain Social Security Numbers of Certain Donors:

Next week marks the deadline for public comment on a new Internal Revenue Service rule giving the tax agency access to the Social Security numbers of donors to certain nonprofit group.

For a tax-collecting agency still under a cloud for accusations of targeting of conservative and Tea Party organizations, the proposed rule has sparked immense concerns. The final deadline for public comment is Dec. 16.

“The IRS needs less information from nonprofits and less opportunity to go after donors for harassing them,” Cleta Mitchell, an attorney for Tea Party groups, told TheBlaze. “I wish they would stop looking for ways to harm people.” ...

In addition to the targeting of conservative groups, in at least one case, an IRS employee leaked information about a conservative organization. The House Ways and Means Committee is investigating the IRS for leaking donor information from the pro-traditional marriage National Organization of Marriage to the gay advocacy group Human Rights Campaign.

In a statement, the IRS insisted there have been “major misimpressions” about the proposed rule.

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December 12, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Friday, December 11, 2015

The IRS Scandal, Day 946

IRS Logo 2Washington Times op-ed, Why IRS Commish John Koskinen Must be Impeached, by Jenny Beth Martin (President & Co-Founder, Tea Party Patriots):

Failing to comply with a subpoena for evidence in a major investigation; lying under oath in testimony before Congress; providing misleading and inaccurate information to Congress; hampering an ongoing investigation into the targeting of innocent American citizens. These are all serious offenses, violations of the public trust.

John Koskinen, the current IRS Commissioner, committed each one. Incredibly, he has not been removed from his post. Americans, are understandably disgusted that the rules that apply to the rest of us appear not to apply to government officials who enjoy comfortable jobs with guaranteed pension packages. ...

Apparently, some in Congress misunderstand the function of impeachment. They seem to think impeachment is a tool to be used only against a government official proven guilty of committing a crime. But impeachment is not a legal remedy; it is a political remedy.

As Alexander Hamilton wrote in Federalist 65, impeachment was meant as a remedy for “those offenses which proceed from the misconduct of public men, or, in other words, from the abuse or violation of some public trust.”

In an age where the Justice Department is unwilling to prosecute those seen to be doing the president’s will, even in violation of the law - or, at the very least, the public trust - impeachment is the necessary and appropriate response.

At the heart of our system of government, and in fact the entire fabric of our society, is the notion of trust. Americans must be able to trust our government and have confidence that the IRS has not become a political weapon silencing people who disagree with the current administration. For violating the public trust, and for damaging the public’s faith in the integrity of our government, Mr. Koskinen must be removed from his position. There is simply no better first step to restore the public’s confidence in our government.

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December 11, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

Thursday, December 10, 2015

The IRS Scandal, Day 945

IRS Logo 2Forbes: National Organization For Marriage Denied Attorney Fees In IRS Lawsuit, by Peter J. Reilly:

It looks like the National Organization for Marriage has come to the end of the line in its hope for a big payday from the IRS for the unauthorized disclosure of the Schedule B (donor list) attached to its 2008 Form 990. Form 990 becomes public (The easiest way to find one is on, but the donor list is not publically disclosed.  The Fourth Circuit upheld a district court decision denying NOM attorney fees in its suit against the IRS.  IRS had admitted that it was wrong in releasing the Schedule B and settled with a payment of $50,000.  NOM was seeking $691,025.05 in fees.

The disclosure caused a bit of a stir, because it showed that a Mitt Romney related entity had given money to NOM.  Also, according to this story, two years after the disclosure Brian Eich was pressured to step down as CEO of Mozilla because of his $1,000 donation that was on the list.  The Mozilla story was Day 331 of Paul Caron’s IRS Scandal coverage.  The original story of the disclosure was covered by the Tax Prof on April 13, 2012 over a year before the launching of the scandal series. ...

The NOM disclosure issue wove its way into the IRS scandal narrative.  The core scandal is the delay and intrusive questions in processing the exemption applications of Tea Party and similar groups.  Earlier this week Paul Caron on The IRS Scandal, Day 943 noted that Brian Leiter of the University of Chicago Law School had queried his readers “Has there really been an IRS scandal going for nearly three years?” Professor Caron maintains that he will keep with the coverage as long as there is something out there.  He did indicate that there is not much in the queue right now, so there is some chance the series might go dark at least for a while.

In a private exchange with another blogger on that post, I noted that the NOM litigation was still outstanding.  So that’s one down.  I’m pretty sure that the Z Street litigation is chugging on.  Although Judicial Watch has not added to its IRS scandal blog since Labor Day, I think it is likely that they have some more cats to pull out of the bag.

I wonder whether the IRS scandal will go down in history like the Dreyfus Affair or the Sacco-Vanzetti trial or if it will just fade away.

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December 10, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Wednesday, December 9, 2015

The IRS Scandal, Day 944

IRS Logo 2Following up on yesterday's post on Brian Leiter's poll on whether I should continue my daily coverage of the IRS Scandal,  Brian writes:

Prior to the invasion of the Insta-gnorance readers, the normal intelligent readership was 30% in favor of the scandal-mongering, the rest against with about one quarter deeming the Blog Emperor's continued coverage the real scandal.

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December 9, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (8)

Tuesday, December 8, 2015

The IRS Scandal, Day 943

Back in October, Forbes tax blogger Peter Reilly asked whether I had jumped the shark by continuing my daily coverage of the IRS Scandal.  My response ("very classy,'' said Peter) asked my readers whether I should continue daily coverage.  The response was overwhelming:  90% of the 973 voters directed me to continue daily coverage of the IRS Scandal:

Poll 3

The comments were even more emphatic (one reader said "Quite possibly the greatest post in the history of TaxProf, regardless of what one thinks happened at the IRS.").

Yesterday, Brian Leiter (Chicago), a member of our Law Professor Blogs Network, asked his readers What is your opinion about the Taxprof blogs daily postings about an IRS scandal that has allegedly been going on for almost three years?  Here were the results of the 38 votes when I checked last night:


I suspect Brian's readers are very different from the readers of this blog, and he attributed nefarious motivations to my daily coverage which undoubtedly influenced the voting.  But it is fair to ask, as Peter did, when my daily coverage will end. My answer is the same as it has been throughout the scandal:  I will stop when the daily commentary in the press and blogosphere on the scandal (from both the right and the left) ends.  At several points in the scandal, as I was running out of content, a new chapter would unfold and my daily coverage would continue.  Currently, the scandal has gone mostly quiet and I have only a few posts left in the queue. So it may be that my daily coverage will end soon, and will be resumed if and when the scandal heats up again. 

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December 8, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (11)

Monday, December 7, 2015

The IRS Scandal, Day 942

IRS Logo, Legislation Would Make it Easier to Fire Senior Executives at IRS:

Lawmakers are continuing to target the Internal Revenue Service with new bills in the wake of news reports that said that senior executives within the agency were targeting conservative groups based on their political beliefs.

Legislation has recently been introduced in the Senate that would give the IRS Commissioner new authority to fire senior executives within the agency who have failed in their performance or committed misconduct.

Known as the Internal Revenue Service Accountability Act of 2015 (S. 2345), the text of the legislation says that the IRS Commissioner “may remove an individual employed in a senior executive position at the Internal Revenue Service from the senior executive position if the Commissioner determines the performance or misconduct of the individual warrants such removal.”

The Senators are introducing the bill in response to the recent stories in the media alleging that high level officials within the IRS were targeting conservative groups based on their beliefs. Investigations into the targeting were closed by the Department of Justice in October.

The Senators say that while the IRS Commissioner currently does have the authority to fire high ranking employees for certain forms of misconduct, this authority failed to be used in the political targeting situation.

press release from Senator Tim Scott (R-SC) describes the need for the bill as follows:

The Administration has claimed that only mismanagement occurred at the IRS and that mismanagement is not a crime and has used this logic to justify its failure to act in the case of Lois Lerner and others who targeted Americans based on their political beliefs. This bill seeks to rectify this problem by giving the Commissioner clear authority to fire employees who fail to meet the standards of conduct and performance we should demand of senior managers at Federal agencies. ...

The House has had its own share of efforts to clamp down on the IRS, one of the most recent examples being introducing a resolution to impeach IRS Commissioner John Koskinen for acts which lawmakers said violated the public’s trust.

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December 7, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Sunday, December 6, 2015

The IRS Scandal, Day 941

IRS Logo 2Milwaukee Journal-Sentinel op-ed:  Governors Should Be Wary of Syrian Refugees, by Merrill Mathews ( Institute for Policy Innovation):

President Barack Obama is once again faced with a problem of his own creation. After all, when you sow disgust you reap mistrust.

For seven years the president has dismissed, demeaned and denounced those who have raised legitimate concerns about his policies.

And when those concerns have turned out to be correct, as they often have — think "if you like your health care plan, you can keep it," the Islamic State being "contained," the promise of a post-partisan America, and so on — he ignores the evidence, berates his critics, and asserts that everything is going well.

So when 31 governors turned their thumbs down on Obama's decision to accept 10,000 Syrian refugees and distribute them among the states, the governors were sending a message that said, "We do not trust you and your administration to tell the truth or do the due diligence necessary to vet refugees."

Let's be clear: Every governor knows this is a country of immigrants with a long and cherished tradition of helping refugees.

And they know that the vast majority of the refugees would be honest and law-abiding, thrilled to get a chance at a new start in America. But even a vast majority isn't 100%, and that presents a legitimate safety concern.

But Obama, true to form, dismissed the concerns and ridiculed the critics. "Apparently they (the Republicans) are scared of widows and orphans coming into the United States of America," the president sneered. He then claimed that the screening process would be the "most rigorous process conceivable." ...

Under normal circumstances, elected officials and most of the public would take the president's word. But this president has misled the public so often that he hasn't earned the benefit of the doubt — and he isn't getting it. ...

Remember the IRS scandal? The Environmental Protection Agency polluting a Colorado river? The Veterans Affairs’ health care scandal? And that “red line” in Syria?

I, for one, hope the administration, Congress and governors can find a solution that upholds the country’s long tradition as a haven for refugees. The mistrust in this case isn’t targeted so much at the Syrian refugees, but at the White House.

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December 6, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, December 5, 2015

The IRS Scandal, Day 940

IRS Logo 2News Max, Conservatives Slam Proposed IRS Rule That Charities Collect Donors' Social Security Numbers:

Conservatives and nonprofit groups Thursday slammed a proposed IRS rule that could require charities to collect and report Social Security numbers for donors who contribute $250 or more, with Washington attorney Cleta Mitchell expressing "shock and dismay" over the potential repercussions of such a requirement.

"I think about every little church, every charity that anybody gives money to," Mitchell told Newsmax in an interview. "How does any donor know whether a charity is going to be able to protect that information?"

Tim Delaney, president and CEO of the National Council of Nonprofits, said the proposal "would be devastating for nonprofits and the general public.

"Nonprofits will be hurt because people will be reluctant to make a donation if it means they have to share their private Social Security number, plus it will divert limited resources away from missions to invest instead in costly new data security," Delaney said. ...

The public comment period ends on Dec. 16. If anyone requests public hearings on the proposed rule, they would be scheduled and notices would be published in the Federal Register. ...

The IRS proposed a similar rule in 2009, but rejected it after an investigation by the Government Accountability Office found — among other conclusions — that taxpayers might reduce their contributions "because they are reluctant to provide Social Security numbers to charities given concerns over identity theft." ...

However, a broader danger exists, according to Mitchell: the IRS targeting conservative groups and their donors for audits, thus drying up contributions.

"I've seen ample evidence that the IRS has used donor information — people who contribute to conservative organizations or Republican candidates, causes — to go after those people and target them for audits," she said.

Mitchell represented many tea party groups in lawsuits against the IRS and the Obama administration who had been targeted for special scrutiny by the tax agency in their applications for nonprofit status for several years leading up to the 2012 presidential election.

In October, the Justice Department closed a two-year investigation into the scandal without charging former supervisor Lois Lerner, who headed the department that screened the applications, or anyone else at the agency.

"Is that what they're trying to do?" Mitchell asked. "Being able to discourage people from contributing to charitable organizations? Is that what they're trying to do, so there'll be fewer people taking the charitable deduction?

"What's the public policy purpose of this?"

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December 5, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, December 4, 2015

IRS Releases 2015 Criminal Investigation Annual Report

IRSIR-2015-135 (Dec. 3, 2015), IRS Criminal Investigation Releases Fiscal Year 2015 Annual Report:

The Internal Revenue Service today announced the release of its IRS Criminal Investigation (CI) annual report, reflecting significant accomplishments and enforcement actions taken in fiscal year 2015.

Focusing on tax-related identity theft, money laundering, public corruption, cybercrime and terrorist financing, IRS CI initiated 3,853 cases in FY 2015. 

“Our criminal investigators continue to bring complex and meaningful cases that have a significant impact on tax administration,” said John Koskinen, IRS Commissioner. “This work also plays an important deterrent effect on would-be criminals, helping ensure fairness for taxpayers and protecting voluntary compliance in our tax system. The report is a tribute to the important work done by IRS Criminal Investigation.”

“This report reflects the extremely high level of commitment that CI agents bring to the job and the great case work accomplished in the past year,” said Richard Weber, Chief, IRS Criminal Investigation. “But the story that the report tells this year is that fewer agents do mean fewer cases. I’m extremely proud of all that we accomplished in spite of our budget challenges, but the inability to hire is really taking a toll.”


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December 4, 2015 in IRS News, Tax | Permalink | Comments (1)

The IRS Scandal, Day 939

IRS Logo 2The Maddow Blog, The IRS ‘Scandal’ Is a Scandal No More:

By any fair measure, the IRS “scandal” evaporated quite a while ago. Right around the time we learned that the tax agency targeted groups on the left, right, and center over their tax-exempt status and political activities, the “controversy” that fascinated the political world for about a week in 2013 was rendered meaningless.

But with Republicans and reporters crying foul – loudly – the Justice Department launched a lengthy and thorough investigation. As the Washington Post reported, that probe is now over. ...

The investigation, which turned up nothing, cost American taxpayers roughly $20 million, leads to two broader questions.

The first is, where’s the accountability for everyone who got this story completely wrong? It was just two years ago that quite a few pundits characterized this non-story as “Obama’s Watergate,” despite the fact that President Obama had nothing to do with the story, and despite the fact that there was never any real evidence of wrongdoing.

GOP lawmakers, in particular, got a little hysterical and raised some striking allegations. The then-chairman of the House Ways and Means Committee said the controversy “started with the White House.” The then-chairman of the House Appropriations Committee insisted the IRS was guided by “the enemies list out of the White House.” The then-chairman of the House Intelligence Committee alleged, without proof, that the IRS engaged in “criminal behavior” that can be traced back to “1600 Pennsylvania Avenue.”

All of these powerful congressional Republicans were completely, demonstrably wrong, as were scores of Beltway pundits, who’ve been reluctant to acknowledge the fact this entire “scandal,” despite the hype, was a mirage from the start. ...

As for the other question, that’s simple: what happens now? According to GOP leaders on Capitol Hill, they intend to continue to focus on the IRS “scandal,” indefinitely, the findings from the Justice Department and the FBI notwithstanding.

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December 4, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

Thursday, December 3, 2015

The IRS Scandal, Day 938

IRSTown Hall, Tea Party Group Pushes Back Against IRS Plan to Collect Social Security Numbers:

Just because the Justice Department’s investigation into the IRS resulted in no charges against the agency, it doesn’t hide the fact that officials had been targeting donors who dared to give donations to groups who didn’t comply with the Obama administration’s liberal agenda.

This exposed bias of the IRS makes tea party groups justifiably concerned about the agency’s plan to collect the social security numbers of donors who give $250 or more to an organization.

The provision, posted in September, is explained as such:

Accordingly, the proposed regulations require that donees who opt to use donee reporting must report that information as well as the donor's name, address, and taxpayer identification number. 

This information is necessary, the agency insists, to “properly associate the donation information with the correct donor.”

Tea party groups are pushing back, arguing such details are superfluous. Here’s what Tea Party Patriots co-founder Jenny Beth Martin told The Daily Signal:

“They don’t need to be collecting Social Security numbers,” she said. “Donations to nonprofits are allowed to be kept confidential. Having gone through the [IRS] targeting [of conservative groups] because our name is Tea Party Patriots, I’m very sensitive to anything that expands the IRS’ reach into nonprofits and who their donors are.”

She, along with other right-minded organizations, are launching a Twitter campaign called #IRSPowerGrab Wednesday to draw attention to the agency’s continual overreach. Concerned citizens also have the opportunity to voice their opposition to the regulation until Dec. 16.

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December 3, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Wednesday, December 2, 2015

The IRS Scandal, Day 937

IRS Logo 2Town Hall, A Small But Real IRS Reform That Must Pass:

President Obama's Department of Justice has made it official: Lois Lerner, the IRS executive who invoked the Fifth Amendment to avoid incriminating herself when questioned about her role in targeting conservative groups, will face no criminal charges. Worse, even the one IRS reform that enjoys broad bipartisan support in Congress - a ban on the IRS trying to assess gift tax on contributions to non-profit organizations, which they infamously attempted against conservative donors - has stalled in the Senate after passing the House unanimously early in the year. It should be included in one of the must-pass bills expected to pass in the next few weeks. ...

Rep. Peter Roskam's H.R. 1104, the Fair Treatment for All Donations Act, should be a priority in Congress. It passed the House without opposition back on April 15 after stirring words of support from Democrat John Lewis, who said: "This bill brings clarity to what has historically been uncertain tax treatment for contributions to social welfare organizations, agricultural associations, labor unions, and trade associations. With this bill, Mr. Speaker, amounts contributed to such organizations will not be subject to the gift tax. I urge all of my colleagues on both sides of the aisle to vote 'yes' for H.R. 1104."

Yet there has been no Senate action for six months, and opposition has actually surfaced from people who like fear of a politicized IRS deterring contributions to non-profit groups. Meredith McGehee, policy director for the Campaign Legal Center, a speech-restricting advocacy group, said: "It strikes me as a wrong-headed move at the wrong moment," and Congressional Quarterly described her as "worried the measure would remove a potential deterrent - the fear of potential gift-tax liability - for mega-donors."

The House need not acquiesce to Senate inaction on the issue. There will be a series of must-pass bills coming to the floor shortly and including H.R. 1104 on one of them should be a no-brainer to force Senate action and finally provide some small measure of control over an abusive IRS that so far has managed to avoid all accountability.

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December 2, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, December 1, 2015

The IRS Scandal, Day 936

IRS Logo 2Wall Street Journal editorial, John Doe Goes to Washington: Wisconsin’s Illegal Probe Went After National Conservative Figures:

Our readers know that Democratic prosecutors in Wisconsin tried to criminalize the political speech of Governor Scott Walker’s allies, but it turns out their ambitions didn’t stop at the state line. New evidence shows that John Doe investigators were trawling the files they collected via subpoenas and search warrants for information on national conservatives. ...

[P]rosecutors and the GAB collected millions of documents, including personal files, emails and bank statements. ... The John Doe team searched the digital cache for information related to their now-discredited theory of campaign-finance coordination, but they didn’t stop there. The Milwaukee District Attorney’s office, run by Democrat John Chisholm, sent GAB staff a spreadsheet of search terms that included prominent national conservatives. ...

The list also includes search terms for such non-scandalous words as “coordination plan” and “message.” The government snoops created ideological search concepts like “big union bosses” and “big government,” as if such phrases suggest some law-breaking intent. Recall that when the IRS targeted conservative groups for special vetting, it created a “Be On the Lookout” list of key words such as “patriot” and “tea party.” ...

[T]he Milwaukee prosecutors and liberal activists at the GAB abused their authority for partisan purposes. The courts need to hold them accountable.

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December 1, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Monday, November 30, 2015

The IRS Scandal, Day 935

IRS Logo 2Fox News op-ed:  Lois Lerner and the IRS: Why We Need a Special Counsel Now More Than Ever, by Jay Sekulow:

When I heard the news that the Department of Justice (DOJ) was closing its investigation into former top IRS official Lois Lerner – who’s at the heart of the unlawful targeting scandal of conservative and Tea Party groups – two thoughts came to mind.

First, the decision not to bring any criminal charges against Lerner or anyone else at the agency is very disturbing -- but sadly predictable. And, second, our federal lawsuit to get to the bottom of this targeting scheme is now more important than ever. ...

Now more than ever it is clear that a truly impartial investigation is needed. We once again call for a Special Counsel – an independent investigation into the truth. But it is equally clear that the only way we will ever get to the bottom of this scandal is through the courts.

We continue representing dozens of conservative groups in multiple cases demanding the truth and accountability in federal court.

Our federal case proceeds on appeal after a key ruling in a related case that could dramatically impact the case and provide justice for those who were targeted.

Of the 38 clients we currently represent, two are still awaiting a response from the IRS on their applications - Albuquerque Tea Party is approaching six years in December and Unite in Action has been waiting for more than three years. 

The targeting has not stopped and neither will we in our pursuit of justice.

Now with the DOJ has closed its faux investigation into the IRS targeting scheme, it’s more important than ever that we discover the truth through depositions in our lawsuit – putting Lois Lerner and others under oath – and ask them the key questions to reveal what the Obama administration refuses to concede: that this orchestrated targeting scheme was designed to keep the president’s political opponents on the sidelines during the last presidential election.

We will not give up. We will not stop pressing for the truth.

Americans should never have to fear that the IRS or any other branch of the bureaucracy will target them for their beliefs.

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November 30, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Sunday, November 29, 2015

The IRS Scandal, Day 934

IRS Logo 2New York Times, Tighter Lid on Records Threatens to Weaken Government Watchdogs:

20 investigations across the government ... have been slowed, stymied or sometimes closed because of a long-simmering dispute between the Obama administration and its own watchdogs over the shrinking access of inspectors general to confidential records, according to records and interviews.

The impasse has hampered investigations into an array of programs and abuse reports — from allegations of sexual assaults in the Peace Corps to the F.B.I.'s terrorism powers, officials said. And it has threatened to roll back more than three decades of policy giving the watchdogs unfettered access to “all records” in their investigations.

“The bottom line is that we’re no longer independent,” Michael E. Horowitz, the Justice Department inspector general, said in an interview.

The restrictions reflect a broader effort by the Obama administration to prevent unauthorized disclosures of sensitive information — at the expense, some watchdogs insist, of government oversight. ...

The inspector-general system was created in 1978 in the wake of Watergate as an independent check on government abuse, and it has grown to include watchdogs at 72 federal agencies. Their investigations have produced thousands of often searing public reports on everything from secret terrorism programs and disaster responses to boondoggles like a lavish government conference in Las Vegas in 2010 that featured a clown and a mind reader. ...

“This is by far the most aggressive assault on the inspector general concept since the beginning,” said Paul Light, a New York University professor who has studied the system. “It’s the complete evisceration of the concept. You might as well fold them down. They’ve become defanged.”

While President Obama has boasted of running “the most transparent administration in history,” some watchdogs say the clampdown has scaled back scrutiny of government programs. “This runs against transparency,” said the Peace Corps inspector general, Kathy Buller. ...

In a rare show of bipartisanship, the administration has drawn scorn from Democrats and Republicans. The Obama administration’s stance has “blocked what was once a free flow of information” to the watchdogs, Senator Patrick J. Leahy of Vermont, the ranking Democrat on the Judiciary Committee, said at a hearing. ...

Nowhere has the fallout over the dispute been felt more acutely than at the Justice Department, where the inspector general’s office said 14 investigations had been hindered by the restricted access.

Human Events, Stop Obama’s War On Watchdogs:

In the sadistic era of fraudulent Hope and Change, inspectors general inside the federal government have been kicked, neutered and starved of the authority and information they need to do their jobs.

It’s transparently clear: President Obama loathes and fears independent watchdogs.

In the sadistic era of fraudulent Hope and Change, inspectors general inside the federal government have been kicked, neutered and starved of the authority and information they need to do their jobs.

It’s transparently clear: President Obama loathes and fears independent watchdogs.

Accountability is an empty talking point without whistleblower protection and investigative autonomy. That is why Capitol Hill must do everything in its power to stop the White House war on the public’s ombudsmen. Federal inspector generals across dozens of agencies are begging lawmakers to grant them access to public records as guaranteed by the 1978 Inspector General Act.

The call for help comes as Obama administration obstructionists and cover-up operatives impede and downplay several key investigations into government corruption and malfeasance.

Last year, 47 of the nation’s 73 federal IGs signed an open letter decrying the Obama administration’s stonewalling of their investigations. The White House, they reported, had placed “serious limitations on access to records that have recently impeded the work” of IGs at the Peace Corps, the EPA and the Department of Justice, and jeopardized their “ability to conduct our work thoroughly, independently, and in a timely manner.”

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November 29, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, November 28, 2015

The IRS Scandal, Day 933

IRS Logo 2Washington Times, Impeach IRS Chief John Koskinen: Congress Must Halt the Tax Agency’s Partisan Scheming, by Alexander Hendrie:

After revelations that the Internal Revenue Service was restricting political speech and targeting conservative and tea party groups, John Koskinen was appointed to head the agency, promising reform and transparency.

These promises never came to fruition. Instead of admitting fault, Mr. Koskinen’s IRS refused to admit wrongdoing and undertook a concerted effort to evade and stonewall congressional investigations.

Investigations into the Lois Lerner targeting scandal have since concluded. A detailed report compiled by the House Oversight and Government Reform Committee and Republican Chairman Jason Chaffetz of Utah has determined that the IRS misled Congress and failed to serve the American people during the targeting and the resulting investigation.

Now the agency must be held accountable from the top down.

Following the release of the findings, congressional investigators called on Mr. Koskinen to resign. He refused.

Investigators called on President Obama to remove him. The president refused.

Then last month, the Obama Department of Justice announced that no IRS employee, including Lois Lerner, would face criminal charges over targeting conservative groups. The Justice Department dismissed the treatment of groups as mere “mismanagement, poor judgment and institutional inertia,” despite the fact that just one conservative group was granted nonprofit status in the three-year time period between February 2009 and May 2012.

The next logical step is to impeach Mr. Koskinen, and Mr. Chaffetz has done what he should by introducing articles of impeachment. ...

While it is clear that there is much to fix in this out-of-control agency, reform can only go so far as long as the commissioner remains so intent on behaving as a political actor.

Step One must be installing new leadership. John Koskinen should be impeached.

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November 28, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, November 27, 2015

The IRS Scandal, Day 932

IRS Logo 2Town Hall, Obama's IRS: "Where Criminals Go Free and Americans Fear Their Government":

It was no surprise DOJ announced it wasn't pressing charges, because after all, considering DOJ attorneys colluded with Lerner on efforts to throw at least one conservative leader in jail to send a message, they'd also have to bring charges against themselves. As a reminder

Last year emails revealed former IRS official Lois Lerner was in contact with the Department of Justice Criminal Division about criminally prosecuting conservative tea party groups for pursuing political activity (opposed to President Obama's agenda) by "posing" as non-profit organizations.

Now, new documents obtained by government watchdog Judicial Watch through two different Freedom of Information Act lawsuits show extensive collaboration between the IRS and DOJ (and subsequently the FBI) to go after conservative groups with criminal charges. The IRS likely violated federal law by illegally sharing 1.25 million pages of taxpayer information with DOJ, which were contained on nearly two dozen FBI backup tapes. Further, information shows DOJ wanted IRS officials who were scheduled to testify in front of Congress about the targeting scandal to turn over planned remarks to them first before delivering on Capitol Hill.

Now that DOJ has issued its non-punishment, individuals and groups targeted by the IRS, DOJ and Lerner are speaking out. ...

“By failing to indict Lois Lerner, the Obama Justice Department – or, should we say, the Obama Injustice Department – is making a mockery of this ‘investigation,’ when countless American citizens, by Ms. Lerner’s own admission, were persecuted by the Internal Revenue Service. This is a woman, after all, who looked into the camera at a national television audience and directly at a congressional committee and refused to answer their questions for fear of incriminating herself," Tea Party Patriots President Jenny Beth Martin said in a statement. “This is just the latest evidence that the Justice Department, whether under Eric Holder or Loretta Lynch, has simply become the political hatchet-men for President Obama and his cronies throughout the Administration. Clearly, we cannot rely on the Department of Justice to provide justice. Consequently, we continue to urge Congress to vigorously investigate the IRS, Ms. Lerner, and their illegal persecution of law abiding American citizens.

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November 27, 2015 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)